Terry has not trained for two days while appearing in front of the Football Association at Wembley over charges he racially abused Queens Park Rangers defender Anton Ferdinand in a Premier League match last October.
"We've been talking to John to see what his mindset is and he's been very positive and upbeat and he wanted to play," Newton told reporters after a much-changed Chelsea side crushed second tier Wolves before a 32,000 crowd at Stamford Bridge.
"John is always very enthusiastic about playing. He's fine, he's been dealing with the situation at hand... and there was no problem with the selection process," added Newton.
"We wanted John to start. We got a phone call to say he was on his way back from Wembley nice and early so it was an easy decision. It was also a very positive thing for the club that he played another 90 minutes for us."
"He has played a lot of games, he has a lot of training under his belt, he's a senior player and he's always looked after his body well," explained Newton.
The 31-year-old Terry, who was acquitted in a criminal case in July of racially abusing Ferdinand, on Sunday announced his retirement from international football, saying his position in the England team was "untenable" because of the FA hearing.
Chelsea's head of communications refused to allow questions about the hearing but Newton was allowed to talk about the demands of playing for club and country.
"For all professionals the commitment of playing for club and country is hard physically and the older you get the more demanding that becomes on the body," said Newton.
"If you want to keep playing at the top level for as long as possible for your club, at some point you've got to make a decision."
Terry was greeted with resounding cries of "There's only one England captain" at the start of the match and at the final whistle he several times put his hand to his heart to signal his appreciation to the Stamford Bridge supporters.
